Economic Systems Flashcards
Scarcity
The limited supply of something
The three basic economic questions
What goods/services will be produced?
How will goods/services be produced?
Who will consume the goods/services?
Traditional Economy
All economic decisions are based on customs, traditions, & beliefs
Bartering
Trading without money
Command Economy
All economic decisions are made by the Government
Market Economy
Economic decisions are made based on the changes in prices that occur as buyers & sellers interact in the marketplace
Free Enterprise
Competition between companies (shifts prices of good/services)
Mixed Economy
Having the characteristics of both systems
Economic Continuum
How economically free a country is on a scale of 0-100
Nation-State
Country with very little diveristy
Communism
No private ownership. Everyone equally owns everything and work together.
Capitalism
Private ownership of everything. Runs off of the idea of free competition
Supply & Demand
Amount of a product & people’s willingness to buy it.
Human Resource
Workers and their skills.
